Should I set up in a Free Zone or on the mainland?

A Free Zone offers a tax exemption (0% on qualifying income) if you meet the Qualifying Free Zone Person conditions, which suits an activity geared toward export, dealing with clients outside the country, or with other free zones. But if your core activity is selling directly to mainland clients, that income generally falls outside the exemption and gets taxed at the standard 9% rate above the threshold.

The mainland, by contrast, gives you full flexibility to deal with any client inside the country with no restriction, but without a location-based tax exemption. The right call isn't "which is cheaper to set up" — it's built on who your actual clients are, and whether your activity's shape even qualifies as qualifying income in a free zone to begin with. RASEEKH analyses your business model before you pick a location, not after discovering the exemption doesn't apply to you.